News / Economy

IMF Lifts Suspension of Funds to Malawi

FILE - International Monetary Fund Managing Director Christine Lagarde is greeted by Malawi’s President, Joyce Banda, on arrival at Kamuzu Palace in Lilongwe on her three-day official visit to Malawi, Jan. 4, 2013.
FILE - International Monetary Fund Managing Director Christine Lagarde is greeted by Malawi’s President, Joyce Banda, on arrival at Kamuzu Palace in Lilongwe on her three-day official visit to Malawi, Jan. 4, 2013.
Lameck Masina
The International Monetary Fund has resolved to immediately disburse about $20 million in suspended funding to Malawi. The IMF imposed the suspension last October pending investigations of a scandal in which millions of dollars in public funds were looted from government coffers. Although government authorities are happy with the IMF’s change of heart, commentators warn that this does not necessarily mean all is well on the country’s economic front.
 
The decision to release the funds was made by the IMF at a meeting in Washington on Friday after an extended review of Malawi's finances.
 
IMF Deputy Managing Director and acting chair Naoyuki Shinohara said the funds were released because, “Malawi’s macroeconomic performance under the IMF-supported program has remained broadly satisfactory," and that policy reforms initiated in May of last year are showing positive results.
 
However, he acknowledged that the recent fraud and misappropriation of substantial amounts of public funds and the associated loss of financial aid have negatively affected the country's financial outlook.
 
Revelations of corruption led the country's key donors to withhold millions of dollars in budget support and to demand that the Malawi government investigate and prosecute those involved in stealing state funds.
 
Shinohara said that to restore confidence in the management of its economy, it will be important for the Malawi government to investigate the fraud thoroughly and address the weaknesses in public financial management exposed by the fraud.
 
Malawi’s finance minister, Maxwell Mkwezalamba, told a news conference in Blantyre that the release of the IMF funds will encourage other donors who have withheld aid to resume funding.
 
“This is a green light to our development partners to continue assisting us. And this becomes particularly important for the CABS, the Common Approach to Budgetary Support, that had decided to delay the disbursement of budget support on the account of the looting on government resources, so there is already indication that the CABS [donors] group will come forward to support Malawi,” said Mkwezalamba.
 
Mabvuto Bamusi, an economic and social commentator, said that despite the release of IMF funds, Malawi cannot be complacent.
 
“There is a lot of caution that needs to be taken, and one of the cautions is that the government at Lilongwe should avoid being overexcited and pretending that everything is back to normal because we still have scenario where the cost of living is still very high and that, cannot simply being addressed by the $20 million from the donor community,” said Bamusi.
 
Bamusi also said that unless the Malawi government addresses issues such as drug shortages in hospitals, dilapidated roads, and problems in the procurement of school materials, it still would be a fallacy to talk about economic normality.
 
He also pointed out that whether or not some of the other donors who withheld aid will release it is still uncertain; just because the IMF has done so does not guarantee anything.
 
Malawi is only four months away from general elections, and Bamusi thinks it likely many individual donors will take a wait and see approach.

You May Like

Photogallery South Africa Bans Travelers From Ebola-stricken Countries

South Africans returning from affected West African countries will be thoroughly screened, required to fill out medical questionnaire, health minister says More

Multimedia UN Launches ‘Biggest Aid Operation in 30 Years’ in Iraq

Move aims to help thousands of Iraqi religious minorities who fled their homes as Kurdish, Iraqi government forces battle Sunni insurgents More

Video African Media Tries to Educate Public About Ebola

IT specialists, together with radio and TV reporters, are battling misinformation and prejudice about disease More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Gaza Conflict, Hamas Popularity Challenge Abbasi
X
Scott Stearns
August 21, 2014 9:20 PM
The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls for Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid

World Currencies

EUR
USD
0.7492
JPY
USD
102.27
GBP
USD
0.5960
CAD
USD
1.0950
INR
USD
61.300

Rates may not be current.